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Workers Compensation Fraud Prevention

American Family values and appreciates the active role you play in your workers' compensation insurance decisions. While instances of workers' compensation fraud are rare, if not controlled, they can lead to premium increases.

Here are some steps you can take to help prevent workers' compensation fraud in your business.

Familiarize yourself with the types of fraud

Some common workers' compensation scams involve:

Faking or causing an injury

Working for another employer while collecting benefits

Claiming a non-work injury as a work injury

Returning to work while collecting benefits

Falsifying treatment that was not rendered

Misrepresenting the seriousness of an injury

Lying about lost wages

Investigate all accidents

Not only will this help you remedy any hazardous situations in your work environment, it will also uncover signs of possible fraud. This includes interviewing witnesses and reviewing video surveillance, if available.

Identify potential fraud indicators

The National Insurance Crime Bureau suggests that a claim might be fraudulent when two or more of the following elements are present:

Rumors of foul-play

An unusually long time between when a claim occurs and when it is reported (especially if the injury is serious)

The employee can never be reached at home or provides a pager as the main number

The employee switches doctors after being released to work

The employee’s story of the accident changes

The accident happened outside of the employee’s normal working hours

No one witnessed the injury

Educate your employees about fraud's financial impact

Discuss your workers' compensation policies and procedures with your employees, including what to do when an injury occurs and your stance on fraud. Let them know that fraudulent claims lead to higher insurance costs, which can impact the amount of money your company has for their other benefits.

Hold exit interviews

Part of your exit interview should include a signed statement from the employee as to whether or not they experienced an unreported injury at work. This will discourage post-termination claims. If you suspect an employee has filed a fraudulent claim, notify your American Family agent or workers' compensation claim representative. We will then perform an independent investigation to further verify the nature of the claim.